What Does Deconsolidation Mean to Those in the Last Mile Delivery Business?

The United States Postal System estimates it delivers approximately 800 million packages between Thanksgiving and New Year’s Day. 

The USPS is just one way of sending packages.

You can make your business stand out with efficient delivery services. Consolidation and then deconsolidation makes package delivery more efficient. 

Keep reading to learn what deconsolidation means to those in the last-mile delivery business. 

Deconsolidation: What is It? 

Before understanding deconsolidation, you must first understand consolidation.

Consolidation does not refer to the merging of businesses. It refers to taking several packages and putting them into a larger container, like a shipping container.

Let’s say you own a company in San Diego, and you are planning on shipping several packages to your customers in the Midwest. You could send each package separately to individual cities.

You could also consolidate those packages into a single freight container and ship them to a central city, like Chicago. In Chicago, the workers at the cargo hub would separate the individual packages in the freight container and then ship them the shorter distance to their specific cities.

The process of separating the components of the consolidated shipment is what we call deconsolidation.  

Why Deconsolidate? 

Sometimes, even when you have a big shipment to send to your customers, you still do not have a big enough shipment. The freight world has a special term for this size of a shipment. LTL means “less than truckload” freight.

This means you do not have enough for a truck, but you still have a significant amount.

Consolidation and deconsolidation make sense for LTL loads.

Deconsolidation can reduce the number of times a single package is handled, and this leads to better customer service overall. The package has less chance of mishandling and damage.

Also, consolidation and deconsolidation can lower overall freight costs. When you consolidate your packages, you can scale your shipping without increasing your shipping costs. So the collective cost of shipping will cost you less than if you had shipped each package individually.  

Why Does Deconsolidation Matter to Last-Mile Delivery? 

Companies with great last-mile delivery reputations may wonder how deconsolidation will affect them. It will give them an opportunity to transport more packages, in a sense. 

Because businesses are choosing to consolidate their packages, ship them to a closer warehouse, and then have a local company take apart the container, last-mile companies now have a foot in the door. They can complete the delivery after deconsolidation. 

Potential Problems and Solutions for Senders

All solutions have potential problems. Consolidation and deconsolidation are no exception. 

For example, when you decide to not use direct shipping, you have to select last-mile carriers. You will also have to use a freight forwarder if you want to use tracking on your products. 

Freight forwarders make sure products have no bumps on their journey between the carrier and location. 

Additionally, your packages may move from a full truckload to an LTL situation to small packing. With each of those situations, deconsolidation could take place in several places. Your packages may even be reconsolidated and then taken apart again. 

You must be able to track your freight to ensure its safety throughout the shipping process. 

You need to have hefty tracking tools on all of your freight to ensure its safety. The freight business has AIDC (automated identification and data capture) and RFID (radio frequency identification code) to help with tracking. 

Because you’re not sending your packages directly to a consumer and rather to a warehouse for deconsolidation, you need to track it. 

When you use consolidation and deconsolidation, you can potentially increase the number of touchpoints. Touchpoints refer to the number of times your package is handled. 

Each time a new person handles your package, you increase the chances of your package sustaining damage. When you deconsolidate, you have the potential to increase those touchpoints and thus risk more damage. 

As you plan the path for your freight, select the fewest touchpoints possible. If you still have several, then you must track your shipment to ensure its safety. 

The more places your freight visits, the more potential you have for weather delays. If you’re using a number of consolidation and deconsolidation locations, you will eventually run into environmental delays. 

Freight forwarders should keep an eye on the environment and move the freight before delays begin. 

When you move your shipment and have many people handling it, you also run the risk of delays because of unloading or deconsolidation. A poorly managed yard can result in your package being mishandled during deconsolidation. 

As you look at the consolidation and deconsolidation process, you will ultimately be looking at freight forwarders and last-mile delivery services. You will take the responsibility of shipping off your shoulders and put it on theirs.  

Reducing the Cost of Deconsolidation

Deconsolidation means your package moves from your business to a central warehouse and then to the customer’s front door. It does not go directly from your house to theirs. 

This can cost more money if you’re not careful. 

You can reduce the cost on your end if you do the following things.

1. Plan for package movements and deconsolidation. Package your products carefully, knowing it will move several times. This will prepare it adequately for last-mile deliveries. 

2. Prepare documentation carefully. If your package will cross a border, have the right documents in place. Use pre-approved international shipping lanes. 

3. Use a tracking system. You need some real-time traceability and visibility for your package. In the age where porch pirates steal packages from front steps regularly, you need to track your package. 

4. Weight and measure carefully. You need to accurately report your package weight, dimensions, and volume. This matters specifically if you will use consolidation and deconsolidation. 

Deconsolidation Boosts Last-Minute Business

Deconsolidation means last-minute delivery services will ultimately have more business. They can plan on seeing their business increase as businesses rely on them to move packages the last leg of a long journey. 

For all of your shipping needs, contact us.